v.
GOODALE
Lead Opinion
On Motion to Dismiss.
On the Merits
[*469] On the Meeits.
Opinion by
The question is here presented whether it is competent to show by parol testimony that a contract executed by and in the name of an agent is the contract of the principal, where the principal was known to the other contracting party at the date of its execution. There are two opinions touching the question among American authorities, — the one affirming and the other denying; but the case is one of first impression here, and we feel constrained to adopt the rule which may seem the more compatible with the promotion of justice, and the exaction of honest and candid transactions between individuals. The English authorities are agreed that parol evidence is admissible to show that a written contract executed in the name of an agent is the contract of the principal, [*471] whether he was known or unknown; and the American authorities are a unit so far as the rule is applied to an unknown principal, but disagree where he was known at the time the contract was executed or entered into by the parties. All the authorities, both English and American, concur in holding that, as applied to such contracts executed when the principal was unknown, parol evidence which shows that the agent who made the contract in his own name was acting for the principal does not contradict the writing, but simply explains the transaction; for the effect is'not to show that the person appearing to be bound is not bound, but to show that some other person is bound also. And those authorities which deny the application of the rule where the principal was known do not assert or maintain that such parol testimony tends to varv or contradict • the written contract, but find supp m the doctrine of estoppel, it being maintained a party thus dealing with an agent of a known p. sipal elects to rely solely upon the agent’s responsibility, and is therefore estopped to proceed against the principal. The underlying principle, therefore, upon which the authorities seem to diverge, is the presumption created by the execution of the contract in the name of the agent, and the acceptance thereof by a party, where the principal is known. Is this presumption conclusive or is it disputable? Without attempting to reconcile the decisions, we believe the better rule to be that the presumption thus created is a disputable one, and that the intention of the party must be gathered from his words, and the various circumstances which surround the transaction, as its practical effect is to promote justice and fair dealing. The principal may have recourse to the same doctrine to bind the party thus [*472] entering into contract with his agent. Parol evidence, however, is not admissible to discharge the agent, as the party with whom he has dealt has his election as to whether he will hold him or the principal responsible. This doctrine must be limited to simple contracts, and may not be extended to negotiable instruments and specialties under seal, as they constitute an exception to the rule. As bearing upon these deductions see 1 Am. and Eng. Ency. of Law, 392; Briggs v. Partridge, 64 N. Y. 362 (21 Am. Rep. 617); Nicoll v. Burk, 78 N. Y. 583; New Jersey Steam Navigation Company v. Merchants’ Bank, 47 U. S. (6 How.), 380; Nash v. Towne, 72 U. S. (5 Wall.), 703; Stowell v. Eldred, 39 Wis. 626; Chandler v. Coe, 54 N. H. 561; Ford v. Williams, 62 U. S. (21 How.), 289; Hunter v. Giddings, 97 Mass. 41 (43 Am. Dec. 54); Trueman v. Loder, 11 Ad. and E. 589; Higgins v. Senior, 8 Mees and W. 843; Calder v. Dobell (Law Rep.), 6 Com. Pleas, 485; Mechem on Agency, §§ 449, 698, 699. If an instrument is valid without a seal, although executed under seal, it is to be treated as written evidence of a simple contract; and the seal adds nothing, except, under our statute, it is made primary evidence of a consideration: Stowell v. Eldred, 39 Wis. 626; Byington v. Simpson, 134 Mass; 169 (45 Am. Rep. 314); Rector of St. David’s v. Wood, 24 Or. 404 (34 Pac. 18).
Now, looking to the contract which is the basis of the cause of action under consideration, we find that it was executed in manner and form as requested by the defendant, and to subserve a special purpose peculiar to his own interest, with the express avowal that it should be treated as the contract of plaintiff, although executed in the name of Handsaker the agent. It is further disclosed that both the defendant and the plaintiff afterwards so treated it; the plaintiff proceeding under it, and in obedience with the terms [*473] and conditions thereof in cutting, hauling, and banking the logs preparatory to delivery, and the defendant by making payments to him from time to time, sometimes directly, and sometimes through Handsaker, the agent. This is ratification, and constitutes a very significent feature of the inquiry. Aside from this, the contract discloses upon its face that a part of the consideration for these logs moved directly from defendant to plaintiff. Under these attendant circumstances, and others which might be alluded to, we think the court committed no error in admitting the testimony to show who were the real parties to the contract, as well as to explain how the clause touching the one thousand seven hundred dollars came to be placed therein. The admission of the parol evidence touching this clause may be upheld as being explanatory of the consideration which in part supports the contract.
There are some other questions presented by defendant in his brief and at the argument. These we do not deem it necessary nor profitable to discuss in detail, but suffice it to say we have carefully examined them all, and find no prejudicial error.
Affirmed.